Investment options for senior citizens are abundant, but few are as popular as fixed deposits (FDs). Fixed deposits are a safe and secure choice for senior citizens, particularly in a time when market volatility and capital protection are at the forefront of investment concerns. The regular income provided by FDs is also ideal for senior citizens who are looking to build an emergency fund.
Even though bank FDs are taxed, the lower tax rate for most senior citizens significantly reduces the tax liability. With the recent hike in the Reserve Bank of India's repo rate, banks have increased lending and deposit rates, making FDs an attractive investment option for those seeking higher returns.
Banks often offer senior citizens higher interest rates on their fixed deposits, with some of the top lenders providing 50 basis points over the standard interest rate. The list of banks and their highest FD interest rates for senior citizens can be found online, and it's important to note that the Deposit Insurance and Credit Guarantee Corporation guarantees investments in FDs up to INR 5 lakh.
Bandhan Bank offers 8.50 per cent interest on 600 days (1 year, 7 months, 22 days), while Yes Bank offers rates of 8.25 per cent and 8.00 per cent on 35 months and 25 months respectively. Axis Bank offers 8.01 per cent on 2 years < 30 months, while IDFC First provides 8.00 per cent on 18 months 1 day- 3 years (549 days to 3 years).
IndusInd Bank offers a range of interest rates based on the tenure of the investment, with rates ranging from 8.25 per cent to 8.00 per cent. RBL Bank provides 8.30 per cent on 453 to 459 days (15 months), 460 to 724 days (15 months 1 day to less than 725 days), and 725 days. Suryoday Bank offers rates of 8.51 per cent for above 1 year 6 months to 2 years, 8.01 per cent for above 2 years to 998 days, and 8.76 per cent for 999 days.
DCB Bank has a range of interest rates based on the tenure, with rates ranging from 8.00 per cent to 8.35 per cent for tenures from 18 months to 120 months. Ujjivan Small Finance Bank provides 8.75 per cent for 80 weeks, and Equitas Small Finance Bank offers 8.5 per cent for 888 days.
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